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Trade barriers costing Africa billions of dollars, says World Bank study

Published date:
Wednesday, 08 February 2012

African countries are losing billions of dollars in trade opportunities within the continent due to trade barriers, a new study by the World Bank says.

It warns that most African countries, especially those relying on traditional trade partners in Europe, could experience a further drop in earnings from trade because of the Eurozone debt crisis.

“While uncertainty surrounds the global economy and stagnation is likely to continue in traditional markets in Europe and North America, enormous opportunities for cross border trade within Africa in food products, basic manufactures and services remain unexploited,” read the report.

According to World Bank forecasts, economic slowdown in the eurozone is likely to lower Africa’s growth by up to 1.3 percentage points this year.

The region is a target market for more than 80 per cent of Kenya’s flower and horticultural exports, and the source market for the tourism sector.

Predictions on the Gross Domestic Product (GDP) growth released by the World Bank last month, put the expected GDP growth rate for developing economies at between 5.4 and 6 per cent, down from an earlier projection of between 6.2 and 6.3 per cent made in June last year.

Meanwhile, the East African Community (EAC) is struggling with the thorny issue of non-tariff barriers, even after removal of trade tariffs on goods produced within the region.

The current quarterly report on the status of elimination of non-tariff barriers within EAC indicates that several such barriers are yet to be removed.

These include lack of harmonised import/export documentation and procedures, existence of numerous institutions involved in testing goods due to lack of a common EAC certification mark, lack of harmonisation in customs working hours and existence of several weighbridge stations along the central and northern corridor, which cause delays in transportation of goods among others.



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